Where to Buy DRIP Stocks

By Sun

I am a fan of dividend reinvestment plan (DRIP), though I didn’t start participating till late last year. Currently, I have several stocks purchased through DRIP programs: Bank of America (BAC), Progress Energy (PGN), and Procter & Gamble (PG). The first two are from ComputerShare while the last one is from the company directly.

The main benefit of buying stocks directly from the issuer either through a Direct Stock Purchase (DSP) plan or a DRIP program is that you don’t always have to pay a commission when making a purchase as you do with most brokerages, though some DRIP programs also charge a fee for direct purchases and in some cases the fees are no cheaper than what you will pay through a broker that also offers dividend reinvestment. Therefore, when I decide which DRIP program to participate in, I only choose those with either no purchase fee or the fee is much lower than that’s charged by my brokerage firm such as Sharebuilder. Two of my DRIP stocks, BAC and PGN, don’t charge purchase fees.

Looking for a cheap stock broker to trade stocks, ETFs, or options? Check out

If you are interested in DRIP stocks, the following are some places that offer DRIP/DSP programs or related information:

ComputerShare: Domestic stocks only and you can find many blue-chip stocks

The Bank of New York Investor and Client Service: Offer both domestic stocks and ADRs

StockSelector.com

DirectInvesting.com

Also check out the related posts below for more discussions on DRIP programs.

This article was originally written or modified on . If you enjoyed reading this post, please consider subscribing to my full RSS feed. Or you can also choose to have free daily updates delivered right to your inbox.

abhush: Actually, I thought about Zecco and like the idea of no-fee trading. The only reason I didn’t use it is that I think they are quite young (less than one year) and whether they can maintain the current fee structure isn’t clear. When everybody started to charge fees for mutual fund investing, Firstrade said they will keep it fee-free. They kept that promise for several years (I think it’s three), then started to charge fees for mutual fund investing early this year. I don’t know if Zecco can survive and continue to offer zero commission trading. I’d like wait a while and see what happens with them. Are you using Zecco?

RV | Oct 11, 2007 at 11:14 am

Hello All:

How do one select a stock(s) to invest in DRIPs? Like what are the metrics to look for?

If anyone could provide some relevant information, I would greatly appreciate it.

If you are using brokers such as Zecco, which charges $0 commission and offers dividend reinvestment, then there’s no on need to use DRIP. The reason for using DRIP, I think, is that you can buy stocks directly from
the company regularly, not through a broker, so you can pay less in commissions and fees. That’s not the case any more as most brokers do have dividend reinvestment and you can buy as many shares as as you want with a flat fee. However, if you don’t use Zecco and will pay commissions when buying stocks through your broker, then DRIP may still have some value. Computershares is a good place to find dividend-paying stocks. When I
bough a couple of stocks through Computershares, I looked 1) stocks with high dividend yield; 2) low or no account setup fee; 3) low initial purchase (

Yazmyn | Sep 17, 2008 at 2:54 pm

I suggest http://www.directinvesting.com. The purpose of DRIP is so that you don’t have to use a stock broker. Most of these companies that allow you to purchase these DRIP stocks don’t ever transfer the shares into your name. This is a problem because this truly does defeat the purpose. With directinvesting.com, they do all the legwork to get an account open in your name at the companies. You buy at least a single share of stock (or as many as 100 shares) from them. Then they get YOU on the books and records of the company as a shareholder and after that you can invest in the company directly if you want to buy more shares—WITHOUT GOING THROUGH A BROKER!!!!! http://www.directinvesting.com TRY IT & SEE!!

Yazmyn: I mentioned directinvesting.com in my post, which is one place to buy DRIP stocks. If you want to get DRIP started, you can just buy one share of the stock from a broker, then have it transferred to a DRIP provider.

Receive Free Updates

Today's Deal

EverBank Money Market Account 1.25%: Open an EverBank Money Market Account with a minimum balance of $1,500 and earn 1.25% bonus rate for the first six months. The first year APY is 1.01% for account balance up to $50,000. Find out more about this offer.